IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 8TH DAY OF AUGUST 2019 BEFORE THE HON’BLE MR. JUSTICE ALOK ARADHE WRIT PETITION NO.32194 OF 2019 (GM-TEN) BETWEEN:
PRAVEEN KUMAR S/O PUTTEGOWDA AGED ABOUT 31 YEARS R/O NO.39/3, THOOBINAKERE NAGAMANGALA TALUK DODDACHIKKANAHALLI NAGAMANGALA MANDYA – 571 432 … PETITIONER (BY SRI.SUMANTH L. BHARADWAJ, ADVOCATE) AND:
THE MANAGING DIRECTOR D. DEVARAJ URS TRUCK TERMINAL 3RD FLOOR, TTMC B BLOCK BMTC COMPLEX, K.H. ROAD SHANTHINAGAR BENGALURU – 560 027 … RESPONDENT (BY SRI. D. SADASHIVA, ADVOCATE) THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE ORDER TEMINATION OF CONTRACT DATED 18.07.2019 THAT PASSED BY THE RESPONDENT HEREIN, ANNEXURE-A AND ETC.
THIS WRIT PETITION COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:-
ORDER Sri. Sumanth L. Bharadwaj, learned counsel for the petitioner.
Sri. D. Sadashiva, learned counsel for the respondent.
The petition is admitted for hearing. With the consent of learned counsel for the parties, the same is heard finally.
2. In this petition under Article 226 of the Constitution of India, the petitioner inter alia has assailed the validity of the order dated 18.07.2019 by which the contract awarded to the petitioner has been rescinded.
3. The facts giving rise to filing of the writ petition briefly stated are that the respondent had called for tender on 01.08.2018 for grant of license for cancellation of the parking fee for Goods Carriage Vehicle/Trucks at Ideal Parking Area for a period of one year at Mysore-Nanjangud Road Bandipalya and Nachanahally Village Mysore.
4. The petitioner being the highest bidder was awarded a contract on 01.10.2018 for a period of one year i.e., from 05.10.2018 to 04.10.2019. The respondent issued a show cause notice on 10.06.2019 calling upon the petitioner to offer his explanation in respect of the complaints made by certain owners of lorries to the effect that the petitioner is charging higher rate of parking fee. The petitioner submitted his reply to show cause notice on 24.06.2019 and denied the charges leveled against him. By an order dated 18.07.2019, the respondent terminated the contract awarded to the petitioner. In the aforesaid factual background, the petitioner has approached this Court.
5. Learned counsel for the petitioner submitted that the action taken by the respondent in terminating the contract is de hors the contract as the action has been taken in violation of Clause 10 of the Terms and Conditions of the Contract.
6. On the other hand, learned counsel for the respondent submits that Clause 10 applies to the contractors where the charges are leveled against them for breach of Terms and Conditions therein.
7. I have considered the submissions made on both sides. Clause 10 of the Terms and Conditions of the Contract reads as under:
“10. Under any circumstances the contractor shall not increase the parking fee, in case of breach the said Condition it reserves the right to collect penalty as follows.
1. First breach – ` 5000.00 2. Second breach – ` 10000.00 3. Third breach – ` 15000.00 Fourth time or above – The discretion of The Managing Director, D.D.U.T.T.L up to cancellation of the License.”
8. Thus, it is evident that in Clause 10 in respect of the first, second and third breach, an amount of `5,000/-, `10,000/- and `15,000/- shall be collected by way of penalty and in case of the fourth time or above, the Managing Director may, in his discretion, order cancellation of the license. In the instant case, it appears that respondent in the first instance has cancelled the contract. It is well settled law that even in the contractual matter, the respondent shall act in a fair, rational and reasonable manner and cannot be permitted to act in an arbitrary manner in contravention of the Terms and Conditions of the Contract, which are binding between the parties.
9. In view of the preceding analysis, the impugned order dated 18.07.2019 passed by the respondent is hereby quashed. However, the respondent is granted liberty to take action against the petitioner, if so advised, in terms of Cause 10 of the Terms and Conditions of the Contract.
Accordingly, the petition is disposed of.
Sd/- JUDGE Mds/-